Tom Oreck is 'incredibly proud of the people who make their living operating the Oreck stores.' He will buy some of them. / Dipti Vaidya / File / The Tennessean

Written by

G. Chambers Williams III

The Tennessean

The founding family of the Oreck vacuum cleaner brand will remain involved in the business, even though it lost out in its bid to take back the company in a bankruptcy auction.

Although ownership of the brand, founded by David Oreck in 1963, has now passed on to the parent of archrival Hoover, former Oreck CEO Tom Oreck will buy an “unspecified number” of the 100 company-owned Oreck factory outlet stores.

Tom Oreck, who is David Oreck’s son, is “close to an agreement” to buy the retail stores from their new owner, TTI Floor Care North America, and also to serve as a spokesman for the Oreck brand and as a consultant for the company, Tom Oreck and TTI said Thursday.

“The strength of the Oreck brand has always come from our people,” Tom Oreck said. “I am incredibly proud of the people who make their living operating the Oreck stores. The legacy of the Oreck stores is their unyielding commitment to the Oreck customer.”

The sale of the Oreck Corp. assets to TTI was completed Thursday before the announcement of Tom Oreck’s plans to buy the stores, which Simon Lawson, president of TTI Floor Care, had said would be up for sale after TTI took over.

TTI said it would keep the factory open in Cookeville, retaining its 200-plus workers, and would “continue to have a small presence in Nashville.” The total number of stores that Tom Oreck will buy was still being negotiated.

Exactly how many of the 60 Oreck headquarters employees in Nashville would be retained was not specified, but the company had said earlier that it probably would keep at least 15 of them. TTI is based in Glenwillow, Ohio, a Cleveland suburb, and doesn’t need another headquarters.

'Excited' at potential

TTI, through its subsidiary Royal Appliance Manufacturing Co., won the bidding for the Oreck assets in U.S. Bankruptcy Court in Nashville on July 8, and got approval from the court of its bid on July 16. The company is adding Oreck’s popular line of vacuum cleaners and other home-care products to its own stable of brands, which include Hoover, Royal and Dirt Devil.

“We are excited at the potential for a partnership with Tom Oreck,” Lawson said. “He brings a great deal of successful experience with both the Oreck brand and customer-service-driven retail operations.”

Oreck had filed for Chapter 11 reorganization in early May, and a few days later said that it already had a bid from a group led by the founding Oreck family.

But the family came in second in the auction, in which TTI agreed to pay $17.25 million in cash and take over some of Oreck’s debts. That was about $1 million higher than the Oreck family’s final offer.

The network of 250-plus privately owned Oreck factory outlets, including the four in the Nashville area, are not affected by the TTI takeover of Oreck. They will continue to offer sales and service for Oreck products, and will be joined by the company stores that Tom Oreck is buying.